Engadget-AOL story shows danger of acquisition strategy
This is a retweet of sorts of the excellent David Carr column appearing today in the New York Times. It recounts the story of AOL’s website acquisition strategy, and how, especially in the case of Engadget, it doesn’t always work out.
A little background: Engadget was launched in 2004 and was purchased by AOL as part of a larger acquisition of Weblogs Inc. Edited by Ryan Block, then Joshua Topolsky (and it was just announced, Tim Stevens). Now, however, Topolsky and much of the staff has or is leaving the AOL property for a new venture — you can read all the details in Carr’s story.
But this whole saga very much reminds me of other New Media acquisition strategies including that at some newspaper companies. The idea is that in order to acquire New Media cred it is is necessary to buy New Media properties. Those on the outside usually means the death (or at least the decline) of that New Media property.
There are two good reasons why it is hard, though not impossible, to become a New Media company though acquisitions: 1) the old media culture rarely will prove a good work environment for your new staffers; 2) without developing the ability to launch their own New Media properties, old media companies can not exploit their own content advantages and truly integrate their New Media ventures into the company as a whole.
Unfortunately, many a media firm has made its financial reputations by reporting growth through acquisition. It is often hard to remember when reading a report that so-and-so company grew its online advertising 50 percent in one year that the reason for that growth might have been the New Media property it bought the year before.